Energy companies will lobby the government for a get-out clause from the deadline to fully fit carbon capture and storage (CCS) technology to new coal plants by 2025 because they are worried it might not work in time.

Companies, including German-owned groups E.ON and RWE npower, want guarantees that they will not be forced to close their coal-fired plants in 2025 if the technology has not been proven by then.

So this is the next battle that has to be won before the uk can officailly claim to be beyond coal.

No new coal plants are to be built without some Carbon Capture and Storage.

The remainder of any plant built will have to be fitted with CCS within 5 years of it being judged ‘technically and economically proven‘.

The first point puts an end to people just carrying on business as usual. The second point could, in practice, mean that ccs will be forced on companies in the near term or they could be left alone indefinetly. The second point is a cop-out. Which E.ON and uk civil society have already started fighting over.

Decisions about any new coal-fired power plants in the UK have been delayed until the autumn, prompting warnings from energy companies about the growing risk that the country could run out of electricity generating capacity.

Ministers were due to make a decision last year on an application to build the first new coal plant in the UK for a generation at Kingsnorth in Kent – a move expected to trigger submissions for further projects.

However, insiders said the decision was not now expected until after the summer because of a decision by the energy and climate change secretary, Ed Miliband, to order a fresh review of coal policy. The Guardian revealed last week that Miliband was considering plans for tough new limits on global warming emissions from coal plants and wanted the government to help fund more carbon capture and storage projects to make this happen.

The decision was earlier delayed by another government consultation on what companies building new coal plants would have to do to make them “capture ready”, announced last year.

Jonathan Smith, E.ON’s media relations manager, said: “We do not expect any imminent decision, by any stretch of the imagination.”

A further delay in the controversial decision about Kingsnorth will delight environmentalists, who have singled out the Kent plant for opposition, because coal is the most polluting form of energy, and because of concern that building a coal plant without strict pollution control would destroy attempts to curb carbon emissions in emerging economies.

However, Smith said further delays raised the threat that the UK could not build the new plants in time to replace the nuclear and old coal power stations that are due to be closed in the next decade.

A spokesman for the Department of Energy and Climate Change said: “A decision on Kingsnorth will follow our consultation on the conditions around new coal-fired power stations. We are aware of the need to ensure security of energy supplies.”

According to an article in the Guardian on Feb 25th 2009 the government’s is considering a major scaling up of investment in carbon capture and storage. From what this author knows of CCS this would seem to be a misallocation of resources, however, if we are seeing a definitive shift against any new coal without CCS then this would certainly be a welcome development.

According to Chris Smith, former head of the Environment Agency, there is a battle going on over those funds.

“There is a battle going on between the Department of Energy and Climate Change and the Treasury to secure the necessary funds for as wide a range of demonstration projects as possible.”

Perhaps they will take a leaf out of the Conservatives book and use funding from ETS auctions to raise the funds.

“The Conservatives have said they would fund CCS demonstrations using money raised by auctioning carbon allowances under the European Emissions Trading System.”

A couple of things concern me about this. I think the money could be better spent on renewables. The govornment has often used hyperbole when describing CCS but the environmental audit committe amongst others has been critical of its complete lack of commmitment. If –as i suspect, ccs proves to be very expensive and to remain so, and to be vulberable to increasing coal prices, then we may all wish that funds had been better spent on renewables, which only get cheaper with volume of production, the opposite of fossil fuels.

More than one “clean coal” power station could receive official funding, said Ed Miliband, energy secretary, yesterday, changing the government’s policy on backing for the technology.

This could be good for Powerfuel, owned by mining entrepreneur Richard Budge, which hopes to build a clean coal plant in Mr Miliband’s Yorkshire constituency that has not been eligible for support.

This dosent directly relate to EON as any second project would be in adittion to the CCS competition in which Kingsnorth is entered. The key question in the case of Kingsnorth is weather it is a good test site for CCS technology and weather having only 5% ccs on a coal plant is considered good enough by the uk govornment.

The Environmental Audit Committee has made it quite clear that the govornment has moved with a complete lack of urgency on carbon capture and storage…that isn’t because like some of us they think it’s not going to ammount to anything, nope, its because they have there priorities badly mixed up. They are complacent and distressingly incompetent. And look at the rhetoric from Malcom Wicks:

Mr Wicks defended the use of coal in power stations as necessary. “Coal is and will continue to be, in our judgment, a vital part of the energy mix. Diversity is vital. If we don’t have coal, it will bring forth an extra dash for gas. We need to think of the national security implications for that.”

Describing CCS as vital and “dear to my heart”, he said: “We are leading the world on CCS technology.”

Malcom wicks stod down from his place at BERR but is now gordon browns international energy envoy, and thats a bit more responsibility than i`d like him to have.

The EU have just made a move which makes Kingsnorth getting the go ahead that much more likely. Labour dont seem to see renewables as a viable alternative to coal, despite vast evidence supporting this case. They are therefore left in an extremely invidious position where giving coal the go ahead with guarentees that CCS will be used in the future looks like the most viable option to them. However, there are a great deal of risks about this proposal and EON most likely wouldnt build Kingsnorth if it had to bear the risk…the govornment may therefore look to support eon phasing in CCS in the medium term. This would be made easier with the latest round of EU investment –1.25billion euros–in the technology.

Miliband refused to say if he would award the CCS money to Eon, or if he would approve the plant if it lost the competition.

“It is very difficult to reconcile security of supply with our low-carbon obligations, but I don’t want to anticipate what I have to announce to parliament in the coming weeks and months on our approach to this issue because it is a very sensitive matter.”

He admitted, however, that he thinks “Britain should lead by example on CCS”. Giving the green light to a dirty new coal plant would not be seen as setting a good example.

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